GBP/USD Price Correcting Within Uptrend amid Weak USD

• The bias is bullish despite temporary retreats.
• A new higher high activates an upside continuation.
• The GBP took a hit from the UK economic data today.

The GBP/USD price dropped a little and now trades at 1.2362 versus yesterday’s high of 1.2397. The bias is bullish despite temporary drops as the US reported poor economic data lately.

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You already know that the United States retail sales data, PPI, Core PPI, Capacity Utilization Rate, and Industrial Production came in worse than expected on Wednesday. The British Pound dropped a little in the short term as the UK Consumer Price Index reported a 10.5% growth in December versus the 10.7% growth in the previous reporting period.

Yesterday, the US reported mixed data. Building Permits came in worse than expected, while Housing Starts, Unemployment Claims, and Philly Fed Manufacturing Index came in better than expected.

Earlier today, the GBP took a hit from the UK Retail Sales indicator, which reported a 1.0% drop versus the 0.5% drop expected. From the Gfk Consumer Confidence, the indicator came in at -45 points compared to the -41 points forecasted.

The US Existing Home Sales could drop to 3.95M from 4.09M. I think the Canadian Retail Sales and Core Retail Sales indicators could impact the USD.

GBP/USD price technical analysis: Retesting the support zone

Technically, as long as it stays above the uptrend line and the median line (ml), the bias is bullish, so further growth is natural. The 1.2344 historical level is seen as a static support level.

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The current sideways movement could represent a bullish continuation pattern. The price tries to accumulate bullish energy and attract more buyers before jumping at least toward the 1.2443 former high (historical level). The upper median line (UML) of the ascending pitchfork also represents an upside obstacle and target.

The upside scenario could be invalidated only if the rate drops and stabilizes below the median line (ml) and through the uptrend line. A larger growth could be activated by a new higher high.

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